Next up for Obamacare: Launching the exchanges in 2014

Now that the elections saved the health care law from the threat of repeal, the Obama administration and its backers are turning their attention toward getting the law right — before the next elections come around in 2014.

All eyes are on January 2014, when the health insurance exchanges — online portals where individuals and small businesses can get their health coverage — are slated to start covering millions of people. Consumers will have access to tax subsidies, if they qualify, to help them buy coverage, and almost everyone will be subject to the mandate to have insurance.

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Each step holds the potential to reinforce — or change — public perception.

If things go badly — picture consumer helplines that aren’t answered, websites that won’t load, exchanges that aren’t ready to go live on time or a subsidy that won’t go through — Obamacare will get the blame. If it goes smoothly, the controversial law could become a whole lot more popular.

Here’s what to watch from health industry stakeholders:

Health and Human Services

The Department of Health and Human Services’ role in bringing the law to life is going to be a lot bigger than originally thought. With only 17 states and the District of Columbia at the moment saying they’ll put together their own exchange, the administration could be responsible for setting up all or a significant part of the exchange in many of the rest of the states. When the law was crafted, the drafters underestimated the intensity of the ongoing controversy over the law and how few states would want to do the exchange work themselves.

“There’s just this huge operational burden on [HHS] in order to get all of this up and running in 2014 — that’s a huge lift,” said Caroline Pearson, director of health reform at Avalere Health. “And I don’t necessarily anticipate in 2014 that everything will be running smoothly.”

Another significant hurdle for Secretary Kathleen Sebelius’s agency is likely going to be ensuring that the exchanges, Medicaid and the subsidies programs can all “talk” to one another. In theory, consumers will be able to go to the exchange and find out at once whether their income qualifies them for a federal subsidy or Medicaid. But if those programs can’t communicate properly, consumers will miss out.

We’ll soon see the first signs of how that’s going. HHS will have to give states preliminary approval of their programs this January. Exchanges will have to start enrolling people in October 2013 and be up and running fully by Jan. 1, 2014.

The states

States have until mid-December to tell HHS whether they’re going to run their own exchange. And that’s what the Obama administration wants. If states play ball, it could make HHS’s workload lighter. Plus, it puts more of the law in the states’ hands, potentially mitigating the idea that the law is a “federal government takeover” of health care.

Readers' Comments (15)

Oh this should be good.. They lied about every single aspect of it and yet the moron class could care less and doubled down on stupid. But at least we know we have a competent HD in Sebelius, who broke the Hatch Law with zero ramifications.

This article misses an important point . Will people be able to afford coverage even with government help.

An example: According to the Kaiser Health Subsidy Calculator a family of 4 making 60K a year would pay $11,104 ($925 per month) for insurance. He would receive a $6,167 tax credit. This leaves $4,937 payment for the family. Additionally the subsidy is a tax credit which means that the entire payment of $925 dollars must be paid initially by the policy holder.

My question!! Does anyone out there know a family of 4 who can take 925 dollars a month out of their budget to buy insurance. I sure as hell don't.

Isn't it interesting that the Democrats would absolutely NOT hear of having private insurance companies compete across state lines? Yet, the new GOVERNMENT insurance exchanges are going to do just that - compete across state lines.

This is a very deceitful and vile government that oversees the people of the United States of America.

Just a prediction, this will work as well as the stimulus did in creating jobs, as well as cash for clunkers, and it will have all of the success of obama's budgets. kathleen sebelius is a stooge and is unqualified for the cabinet position she holds. obamacare will drastically increase the cost of healthcare and lead to the largest exodus of medical professionals this country has ever seen. I can see $250/tablet aspirin in future hospital stays. This is a tsunami that will take our country down to a low we have never seen. After obamacare, the increasing debt, and obama's massive job killing strategy, the United States will be sinking toward third world status. There is nothing hopeful coming from democrat politicians nor from obama. The legacy for our children is abominable. Thank you democrats.

Hey Charlmac.10....families making up to 400 percent of the federal poverty level may qualify for premium support if deductions don't make insurance affordable in your case.

The Affordable Care Act provides tax credits for private health insurance to individuals (and families) with incomes up to 400% of the Federal poverty level. Those who cannot afford insurance premiums will have a combination of employer and government support. If you or your family cannot afford a basic, essential benefits policy, you’ll be eligible to receive subsidized coverage or may become eligible for Medicaid.

Employer Coverage- Employers will have incentives to offer insurance to more employees. In 2014, individuals, families and small businesses can shop on their state’s Health Insurance Exchange, (HIX). In 2017, large employers can shop on their state’s HIX.

Self-Pay- Individual employees may be eligible for premium credits and cost-sharing subsidies, either because an employer: 1) does not offer coverage, 2) does not insure for at least 60% of the cost, or 3) offers coverage that costs more than 9.5% of an employee’s yearly income. Individuals and families that do not have employer provided minimum coverage can shop for it on their state exchange with cash and / or premium supports.

Medicaid Expansion- In 2014, if you are under 65 and have low income, you may become eligible for Medicaid. The health reform law extends Medicaid coverage to individuals between ages 19 and 64, with incomes up to 133% of the federal poverty level, ($14,856 for an individual and $30,656 for a family of four, in 2012). The federal government pays states 100% of the cost of covering all newly eligible people through 2016 and pays at least 90% through 2020

Other-Temporary visitors to the U.S. and the undocumented do not benefit from the ACA.

Affordability and Minimum Value- “Affordable” means that health insurance costs 9.5% or less of an employee’s gross income. “Minimum Value” means that an employer pays for at least 60% of an employee’s premium costs.

If employer-sponsored coverage does not meet the thresholds of affordability and minimum value, the employee may go to the HIX to purchase coverage and may be eligible to receive a federal subsidy

Mikey123 - "Oh this should be good.. They lied about every single aspect of it and yet the moron class could care less and doubled down on stupid."

Yes Mikey conservatives lied about every aspect of the ACA, and they doubled down on stupid by calling for repeal. As if repeal was a reasonable alternative to ensuring health security for every American.

donaize - "Isn't it interesting that the Democrats would absolutely NOT hear of having private insurance companies compete across state lines? Yet, the new GOVERNMENT insurance exchanges are going to do just that - compete across state lines."

No, the federal exchange does not automatically permit competition across state lines. Insurance regulation is still state-by-state.

Here's something you clearly do not understand: "across state lines" (ASL) insurance effectively federalizes insurance regulation. With ASL, the state where the insurer is located in has the regulations the insurer must comply with. So insurers will all move to the state with the most lax regulation, just like credit card companies did. Their benefits and consumer protections will be dumbed down to the lowest common denominator. This is called "race to the bottom." The only regulations left standing are federal ones, effectively federalizing health insurance regulation.

CBO scored the across-state-lines sale of insurance, and said it would reduce quality, and the whole R plan would only bring in around 3 million people compared to ObamaCare's 32 million. Fail.

There is a provision in the health care law for health care compacts where states join together to create a common market for health insurance. That is a responsible way to do "across state lines" without federalizing regulations.

If I were a governor I would not spend a dime of my state's tax money on setting up an exchange. It seems the only reason to do it is it would make the HHS' job of implementation easier. It's a federal law, let the federal government do it. Save the State's tax money on for something that would actually benefit their own taxpayers.

Sosha - "I don't trust electronic medical records even with private outfits, much less the Federal government. I give them as little info as possible."

Conservatives often say that we need to put the consumer in charge of their health care. Then they will take more care as to costs, and shop around for the best deal much like buying a used car or shopping on black friday. Well, if their records are in hardcopy form with the hospital or doctor you have been seeing, don't you see how it slows things down and makes consumer driven health care less likely if your information is not easily transferred and searched by your various health care providers?

This is simply about efficiency and utility... this should be non-controversial.

I would not spend a dime of my state's tax money on setting up an exchange. It seems the only reason to do it is it would make the HHS' job of implementation easier. It's a federal law, let the federal government do it.

The States are already receiving Federal money for various forms of health assistance, including Medicaid.

The Feds could just take that assistance and put it in the exchange.

One possible change would be for the States themselves to ask for Federal permission to voucherize Medicaid and put them all into the State exchange. That would create a larger pool and more leverage for the States to negotiate a variety of premiums and coverages in the exchanges.